Regional students will be poorly served if universities compete solely on price

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Peter Lee does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

At one level, it is heartening that there is so much attention placed on regional universities in all the heat of debate surrounding the deregulation of higher education. We have ministerial assurances that we will “flourish” under the new regime, or that we could become specialist teaching-only institutions, such as they have in the US, thereby combatting, in the words of Professor Warren Bebbington, the “stultifying sameness” pervading the sector.

I must say, if anyone thinks that Adelaide University’s North Terrace campus is anything like Southern Cross University’s Lismore campus, then they are mistaken. The experiences of those studying at ANU are different to those who study in Tasmania or at Charles Darwin or James Cook universities in Australia’s tropical zone. In fact, even within the same university, you can have a different journey towards your degree (on-campus or by distance, for example), albeit with the same quality outcomes.

It is disappointing that we continue to see the fallacy that Australia’s higher education system is not diverse, that there is a “sameness” that pervades the halls of academia across this nation. We seem to suffer a cultural cringe when it comes to Australia’s higher education system.

Our system is distinctive because all of our public universities are expected to undertake teaching and research. Yes, that feature makes our system different from the US. Of itself, that feature doesn’t make us better, or worse. Just different.

Why can’t we applaud that difference, rather than lament it?

As to the assurances that regional universities will “flourish” - of course, I hope that is the case. However, my unease lies in the sub-text of why we will flourish: because we will charge less than sandstone, metropolitan universities.

To put it bluntly: I don’t want to be “competitive” because we’re “cheap and nasty”, because an education in regional Australia is not seen to have the “value” of that delivered by our city colleagues, and that we can be relied upon to offer a cheaper product that soaks up those who can’t access (or afford) a more “upmarket” experience.

So who’s going to pay?

The rules for deregulation have not yet been passed – or even written – and no university has actually declared their 2016 fees. It seems premature to make assumptions about the cost differentials between institutions, with one exception. That exception is that all universities will, at a minimum, need to levy enough from student contributions to help recover the 20% cut across-the-board for the Commonwealth contribution for course fees.

For Southern Cross University, our initial estimate is that this will cost us many millions each year. To even stand still, this loss needs to be recouped from somewhere. We’ve cut staff and tightened our belts - and there is not much more we can do without very drastic surgery. Nevertheless, the reality is that much of this loss in government funding will unfortunately need to be recouped from students themselves.

60% of our students come from regional communities, and 25% are from low socio-economic backgrounds: it is these students who will be asked to pay more, and will not be assisted by the compounding of interest on their debts.

Australian students already contribute substantially to their degrees: overall, there is a 40:60 split between a students’ private contribution and that of the public purse (the actual split depends on the particular degree). Even under the current policy regime, Australia is ranked just behind the United States in terms of the share of private expenditure on tertiary institutions.

According to 2013 OECD figures, the US was ranked 5th and Australia 6th (out of 30 countries) in terms of the respective private costs. The cuts mean that students will move to a 50:50 share: paying more for the same.

I do want Southern Cross University to be “competitive” because we offer the degrees students want to study; we offer these degrees in a place (or by delivery method) that they want to study in, and in doing so, we can offer a “university experience” that they want.

The university experience

Cost pressures being what they are – even before the cuts – universities increasingly have to think about “the university experience” and how we deliver this, in new ways. As students pay more for their studies, the intersection between their expectations and how well we deliver on these, becomes critical.

Our students are not just “student-learners”; they are “consumers” paying for the privilege and forgoing the capacity to earn a full-time income while doing so. More than ever before, universities will need to justify the return on investment over the short and long-term from increasing the tuition fees students pay towards their degree.

This is actually a good thing – even if there’ll be times when institutions squirm with this scrutiny from students and taxpayers. Universities may no longer be complacent about teaching performance, but we’re probably not as smart and creative in challenging modern, technologically-savvy students as we should be. To that extent, the deregulation reforms should play a critical role in making universities look closely at what we teach and how we teach it, and that can only be a good thing.

Teaching-only universities

What is galling in the current debate is the implicit assumption that while teaching should be opened up to the market, research should be kept as an oligopoly. Eight – or maybe ten – players are enough. Indeed, there is an uncomfortable truth that has been inflamed by the 20% cut.

The more a university raises from student fees, the less likely it is that such increases are actually re-invested back into teaching activities. In contrast, those universities with “cheaper” fees will be expected to struggle on, less able to support their broader public good roles of engagement and research.

They may well be a great teaching-only institution or college – and, indeed, if any public university deliberately sets out on that path, then they should be supported in those endeavours. But in so doing, the nomenclature of “university” should be removed from their name – they are no longer an Australian “university” undertaking teaching and research. And more importantly, this should be a deliberate decision, not one they are driven to as a consequence of unwelcome policy outcomes and funding neglect.

How Australian higher ed can improve

The best way Australia can make a more prominent mark on global rankings is for an active and diverse national research culture: some universities will be more research-intensive, excelling across a broad range of fields, while others will focus their efforts in more specialist fields. A genuinely competitive environment such as this leaves no room for institutional complacency or a sense of entitlement to the available funding.

We should be cautious about how we draw policy lessons from other countries. So, yes, the American system is diverse, but arguably, it was this very diversity that prompted the two-year Senate committee investigation in to the for-profit college industry (the Harkin Report).

Nevertheless, rather than cherry-pick the good or the bad to bolster whatever our argument may happen to be, let’s use the policy lessons to help spark useful ideas for reform, but without dismissing the culture, tradition and societal expectations of Australia’s university system.

We are in a time of political and policy uncertainty. It is disappointing that the proposed deregulation reforms have been complicated by the 20% cut in funding. Deregulation offers opportunity, if we can work through the policy framework sensibly. The funding cuts add a dimension that challenges these opportunities in a devastating way.